6 Different Ways of Accounting · Compare Your Options
Six Different Ways Small Businesses Handle Their Books
There are six ways a small business can handle its books. Each one works at some stage of a business. Five of them start to break somewhere between $1M and $20M in revenue. Here is where each option fits, where it falls short, and why outsourcing the whole accounting function, the way Basis 365 does it, gives growing businesses the most capability for the money.
Which One Describes Your Business?
Every small business uses one of these six.
Do It Yourself
The owner keeps the books, usually at night or on weekends.
Family Member
A spouse, parent, or other relative takes on the books, with or without an accounting background.
Part-Time Bookkeeper
A contractor works a set number of hours each month on your transactions.
CPA Firm
Your tax firm also keeps the books, often catching up at quarter-end or tax time.
Full-Time Hire
One employee owns the accounting function in-house.
Outsourced Accounting
An outside firm takes over your accounting and bookkeeping. Done right, you outsource the entire accounting function as a department.
Capability vs. Cost: Where Each Option Lands
The horizontal axis shows the range of accounting skill and coverage you get. The vertical axis shows how affordable the option is each month. The best value sits in the upper right, where real capability meets a cost a growing business can carry.
- 1Do It YourselfCheap in cash. Expensive once you count your own time.
- 2Family MemberLow cost, with skills that depend on the person.
- 3Part-Time BookkeeperAffordable, with a ceiling on skill and coverage.
- 4CPA FirmDeep expertise at hourly rates, focused on tax.
- 5Full-Time HireThe highest fixed cost, with one person's skill set.
- 6Outsourced AccountingTypical firms are capable, though models vary. Often hourly or a smaller team.
- Basis 365 Outsourced AccountingA full fractional accounting department. Four roles for less than one qualified hire.
Each Option Up Close
Every option on this page works for someone. The question is whether it still works for a business your size.
Option 1 Do It Yourself
The owner runs the accounting system personally. It makes sense in the early days when cash is tight and transactions are few.
- Low transaction volume and a simple business model
- You want to learn how money moves through your business
- No cash outlay
- Every hour in the books is an hour you are not selling or building the business
- Cash-basis books hide your true profitability
- Nobody reviews the work or catches mistakes
- You close the books months late, or not at all
- Your CPA spends tax season cleaning up
- You can't answer "what's my margin?" without digging
Option 2 Family Member
A spouse, parent, or other relative takes on the books. Some have an accounting background. Many inherited the job because they were trusted.
- Trust and confidentiality come built in
- Low or no cost
- Simple, stable books
- Accounting often isn't their training or their interest
- Conversations about errors and deadlines get personal
- There is no backup when they need a break
- They want their time back
- Reporting stops at the bank balance
- A lender, investor, or buyer asks for numbers you can't produce
Option 3 Part-Time Bookkeeper
A contractor or freelancer works a set number of hours each month. For most owners, this is the first outside help they bring in.
- Steady, routine transactions
- Affordable, flexible hours
- Data entry and bank reconciliations
- No backup when they are sick, busy, or gone
- They work solo and become the bottleneck. When another client needs them, your work waits.
- Limited hours rarely produce a reliable monthly close
- They hit a ceiling when you need formal accounting skills beyond basic bookkeeping
- Reporting covers what happened and stops there
- Financials arrive late or in catch-up batches
- You need a 13-week cash forecast and the discipline to update it every week
- Your accruals get complex, or you need budgets and KPIs
- Your bookkeeper is at capacity or moving on
Option 4 CPA Firm
Your tax CPA firm also handles the books. Most CPA firms are built around tax compliance, so the books exist to support the tax return. They aren't built for management accounting or day-to-day decisions.
- Tax and books under one roof
- Strong technical knowledge
- You aren't relying on your financials to make business decisions
- The books are built for the tax return, so margin, cash, and KPI reporting fall outside the scope
- Response time drops during tax time, when the firm is upside down processing returns each spring and fall
- Hourly billing makes costs hard to predict
- You need a more collaborative working relationship with your accountant
- Your calls and emails go unanswered
- You need your numbers to make pricing, hiring, or cash decisions
- You want someone in your numbers every day
Option 5 Full-Time Hire
One employee runs accounting in-house. For some businesses it's the right call. For most businesses between $1M and $20M, one person can't match the range of skills the work requires.
- Someone on-site and available all day
- Fully embedded in your team and daily operations
- Work that depends on judgment and constant back-and-forth
- You need someone who also handles work outside the accounting function
- One person can't be sized to your exact needs, so you over-hire or under-hire
- Wages, benefits, overhead, and management time add up
- One resignation takes the whole function out the door
- You pay a controller salary for mostly bookkeeping work
- Your bookkeeper is stretched into controller work
- Coverage disappears during vacations and turnover
- They need part-time help, but you can't hire 1.25 people
Option 6 Outsourced Accounting
An outside firm takes over your accounting function. Depending on the provider, you may get one person or a small team. Basis 365 assigns a fractional team of four, dialed in to the exact skill sets your business actually uses.
- Businesses from $1M to $20M that need more than data entry
- Owners who want reliable monthly financials without managing staff
- Companies that are growing, adding entities, or preparing for an audit or exit
- The team isn't in your office
- Highly subjective processes still need someone on your staff
- Quality varies widely by provider, so the model you choose matters
- You need more than a bookkeeper and less than a full department
- You've been burned by a single point of failure
- You want to stop managing the accounting function yourself
- You're ready to turn your accounting from a cost center into a tactical accounting partner
Not All Outsourced Accounting Is the Same
Outsourced accounting and bookkeeping is a broad term. A solo contract bookkeeper is technically outsourcing. So is a CPA firm that keeps your books.
Depending on the provider, outsourced accounting can mean very different things. The difference comes down to coverage. That means skill range, scalability, continuity when someone is out, and internal controls.
One Person
A contract bookkeeper working set hours. You manage the work.
A Staffed Seat
A remote staffer assigned to your account. You still manage and review.
A Small Team
One or two people, often billed hourly as the work grows.
A Full Department
Four roles from Bookkeeper to Controller for one fixed monthly fee. Maximum coverage and scale.
The full department is how Basis 365 works. Every customer gets a Bookkeeper, Accountant, Accounting Manager, and Controller for one fixed monthly fee. Our team runs on The P-R-O-F-I-T Approach™, so we improve your processes and controls as we do the work. See how our fractional accounting department works.
The Best Bang for Your Buck in Accounting
Basis 365 isn't the cheapest option on this page. It isn't the most expensive either. It delivers the widest range of skills, the steadiest coverage, and the least owner involvement for the price.
Four Roles, One Fixed Fee
Bookkeeper, Accountant, Accounting Manager, and Controller, priced as one monthly fee. You never see an hourly bill.
Sized to Your Actual Workload
You pay for the mix of skill your business needs. When volume grows or you add an entity, the team adjusts with no new hire.
No Single Point of Failure
Documented procedures and a team that knows your account keep the work moving through vacations and turnover. You train us once.
Accrual Financials Every Month
A real monthly close with accrual-based statements, reviewed before they reach you.
A U.S.-Based Controller Leads
Your Controller is your primary point of contact. They review the work and explain what the numbers mean for your next decision.
Your Time Back
No recruiting, training, or managing accounting staff. You spend your time running the business.
Our fractional accounting department model is the Fractional pillar of The P-R-O-F-I-T Approach™. The other five pillars are Performance, Relationships, Optimization, Integrated, and Timely. Need CFO-level planning on top? CFO Support is available as an add-on.
Frequently Asked Questions
Which option fits a business my size?
Under $1M with simple books, doing it yourself or a part-time bookkeeper usually works. Between $1M and $20M, most businesses need skills from bookkeeping through controller oversight. That's where a single person or a tax-focused CPA firm starts to fall short. Outsourcing the whole accounting function fits best at that stage.
Why do quotes for outsourced accounting vary so much?
The quotes rarely cover the same thing. One buys a part-time bookkeeper's hours. Another buys a remote staffer you still manage. Another covers a full team with controller review. Compare who does the work, who reviews it, and what happens when someone is out before you compare price. See how our pricing works.
When should a business move beyond a bookkeeper?
When you start relying on your numbers to make decisions. The first sign is usually the need for a 13-week cash forecast, updated every week. Complex accruals, budgets, and KPIs follow. Those take accountant and controller skills beyond basic bookkeeping.
Can I keep my CPA for taxes and outsource the monthly accounting?
Yes. Your CPA keeps preparing your tax returns. Basis 365 handles the monthly accounting and works alongside your CPA so your books are ready at tax time. Basis 365 is not a CPA firm and does not prepare tax returns.
When is a full-time hire the better choice?
Hire in-house when you need someone at your beck and call, fully embedded in daily operations, or handling work that depends on judgment and constant back-and-forth with your team. Many businesses use both. A staff member owns the subjective, on-site pieces while a fractional team handles the rest.
What if part of our process can't be outsourced?
Usually it can, once someone reviews it. Most processes that seem impossible to outsource were built around how things have always been done. We review and simplify those workflows. When a step truly needs someone on-site, we recommend a member of your staff own it while our team handles the rest.
See What the Switch Looks Like
Tell us how your accounting runs today. We'll show you what Basis 365 would cover and what it would cost for your business.